Developed as part of the government's 'Beti Bachao, Beti Padhao' campaign, Sukanya Samriddhi Yojana or SSY is a welfare scheme designed for the girl child. Investing in this child insurance plan allows parents or legal guardians to ensure financial security for a girl child aging ten years or below. Under the Sukanya Samriddhi Yojana, an account in the name of the girl can be opened across any of the private and public sector banks for 21 years. The tenure of investment under SSY is 21 years, starting from the account's opening date.
How do Investments under Sukanya Samriddhi Yojana Work?
As parents, you can invest a minimum of Rs 1,000 and up to Rs 1.5 lakhs every year into your daughter's account under the Sukanya Samriddhi Yojana. These deposits can be made only for the first 15 years after opening the account, after which the funds in the account would grow from the accumulated compound interest. Subsequently, the accumulated amount can help your daughter support her dreams of higher education, starting a business or marriage, once she becomes a major.
What is the Eligibility Criteria for Opneing an Acount under Sukanya Samriddhi Yojana?
To open an account under the Sukanya Samriddhi Yojana, the following eligibility criteria is applicable –
1. The account must be opened before the girl child turns ten years of age
2. Either parents or a legal guardian can open the account in the name of the girl child
3. A Family with two daughters can open up to two accounts only; if there is a third girl child, then there is no option to open a third account under the SSY scheme
4. More than one accounts for the same girl child are not allowed under Sukanya Samriddhi Yojana
5. If you are unable to invest the minimum deposit of Rs 250 in your daughter's account under Sukanya Samriddhi Yojana, the account will be deemed as a 'Default Account' and will earn interest as applicable under the scheme
6. Premature closure of the accounts under Sukanya Samriddhi Yojana is not allowed; however, premature closure can be processed in specific cases, including –
7. Once a girl child turns 18 years, she is eligible to operate her own Sukanya Samriddhi Yojana
Benefits of the Sukanya Samriddhi Yojana
1. High Interest
Sukanya Samriddhi Account provides a higher rate of interest than other Savings Plans that offer financial security for the girl child. Each financial year, the government declares the applicable interest rate for that year, while the interest on your investments is compounded yearly. By maturity, the assets under your Sukanya Samriddhi Yojana account will increase manifold – thanks to the power of compounding.
2. Significant Tax Savings
Your contributions towards the Sukanya Samriddhi Yojana for your daughter's future are eligible for tax deductions under Section 80C of the Income Tax Act 1961. Thus, you can claim tax deductions up to Rs 1.5 lakh invested in the scheme. Moreover, the tax-saving benefits are also available on the interest earned and the amount received upon maturity or withdrawals. The Sukanya Samriddhi Yojana is under the authority of the Department of Revenue (DOR) and is one of the more popular investment schemes that come with the exempt-exempt-exempt (EEE) status.
3. Guaranteed Maturity Benefits
Upon maturity, your account balance under the Sukanya Samriddhi Yojana, including the accumulated interest, will be paid directly to the girl child (or policyholder). Thus, the scheme essentially helps your daughter becomes financially independent and empowered once she is mature enough to make life decisions on her own. Another benefit of investing under Sukanya Samriddhi Yojana is that your accumulated savings continue to accrue compounding interest even after maturity until it is finally closed by the account holder.
Empower Your Daughter through Sukanya Samriddhi Yojana
Sukanya Samriddhi Yojana provides one of the best investment opportunities for you to build up a sufficient corpus for your daughter when she turns 18 years old. The Sukanya Samriddhi Yojana comes with a sovereign guarantee, while its EEE status implies that it provides several benefits to both the parent and the girl children. Thus, you can invest a portion of your savings towards the Sukanya Samriddhi Yojana to earn compounding benefits on your contributions so that your daughter can financially support her dreams of higher education and marriage despite inflationary pressures.
We will call you shortly.